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Bank Indonesia Bans the Use of Crypto as Payment Method

Bank Indonesia Bans the Use of Crypto as Payment Method
  • Bank Indonesia has banned cryptocurrency as a means of payment.
  • BI Governor Perry Warjiyo said the ban is based on existing laws.
  • The development from Indonesia sounds like a similar action adopted by Turkey.

Bank Indonesia Governor Perry Warjiyo stated that the central bank had banned cryptocurrency from being accommodated as a means of payment.

According to Perry, it is based on existing laws.

Cryptocurrency is not a legitimate payment instrument under the Constitution, Bank Indonesia Law, and Currency Law.

On the other hand, the latest development from Indonesia sounds like a similar action adopted by Turkey. According to a report, the Central bank of the Republic of Turkey (CBRT) also banned crypto payments. Also, declaring that they could not use them to pay for goods and services.

With the volatile nature of crypto assets, most governments have expressed concern, with some strict measures to protect investors. For the CBRT, the use of cryptocurrency for payments could negatively influence the parties involved in the transaction.

While enforcing the ban, Warjiyo said that the Bank of Indonesia would deploy field supervisors to monitor financial institutions. In fact, it aims to ensure that they comply with the central bank’s policy.

Moreover, Indonesia is well known to be cautious of cryptocurrency because of its risks. Back in 2018, the country’s central bank banned crypto-based transactions but later allowed crypto trading as a commodity.

Furthermore, the Bank of Indonesia, like various central banks globally, is exploring a central bank digital currency (CBDC). However, BI governor Warjiyo said that the central bank was researching ways a potential digital rupiah could benefit and improve the country’s payment system.

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A Computer Engineering graduate who writes news focuses on cryptocurrency-related and blockchain technology. He is enjoying using his skills to contribute to informing people of the exciting technological advances that happen every day.